Colin Edward Egan (2018)
Ten Years That Shook the (Capitalist) World: A Brexit Antidote
Rugby: Strategic Management Think Tank

Book Description
This BiteSized Outside Fortress Volume opens in 1987 and progresses with markets in turmoil, greed in the ascendency (a sign of things-to-come), walls falling, curtains opening, Germany reunifying, China emerging, the USSR collapsing, George Soros rupturing the UK’s monetary policy, the fractious 1992 process limping towards a European Single Market and all of this within four years. As the decade progressed the Chinese dragon fiercely roared and its economy soared. Japan wilted while Asian tigers South Korea, Taiwan, Hong Kong, Singapore, Malaysia and Indonesia flourished. The US quietly blossomed in a sustained period of real (non-inflationary) economic growth underpinned by cumulative annual productivity gains.

At the outset of our tumultuous ten years the much-maligned and misunderstood WTO, with all its rules and regulations and deterrents and structures and commitment to fair play, was still on the horizon as the General Agreement on Tariffs and Trade meandered along its half-century journey towards a belated birth of multilateral, rules-based ‘free trade’ in 1995.

Global financial markets were characterised by extreme turbulence in a decade which saw capitalism face-off against two varieties of communism, witnessed dramatic transformations in information and communications technologies and concluded with the Asian financial crisis and the newly minted Russian state defaulting on its sovereign debt in 1998.

This Volume chronicles these cataclysmic events and draws lessons for companies developing global business strategies in turbulent market environments. In the current frenzied and polarised political context businesses should have their strategies, plans and contingencies in place for a post-Brexit free trade competitive landscape regardless of which deal is negotiated: hard, soft or fudgy.

Contents

Preface
Prologue. 1843

1.       A Rude Awakening for Globalization
2.      Ich bin ein Berliner!
3.      The Berlin Wall Falls, Germany Reunifies, Comecon Unravels, The Soviet Union Dissolves
4.      Premature Prognosis: The End of History?
5.      China’s Conundrum and the Clash of Freedoms
6.      George Soros versus the Bank of England
7.       Japan’s Lost Decade?
8.       Inside Fortress Europe and the ‘1992 Process’
9.      Time to Stop Talking: Multilateral, Rules-based ‘Free Trade’ is (Belatedly) Born
10.     Windows ‘95
11.      Globalization Interrupted: George Soros Returns, the Asian Financial Crisis, Russia Defaults
12.     Why Genius Failed and No One Noticed
13.     1999-2018: A Brief Overview and Brexit
14.     Exploring Global Business Strategy
15.     Capitalism versus Communism: Half-Time

Epilogue. Capitalism: And How to Survive It!
End Note One. Milestones in the History of Globalization
End Note Two. Author’s Recommended Textbooks and Business Biographies

Volume One References

MEDIA RELEASE

 

Read All About It!

A new book by award-winning author, economist and former Professor of Strategic Management:
Colin Edward Egan.

(The sections below present an adapted version of the Media Release used to announce this book).

 


Colin Edward Egan (2018)

Ten Years That Shook the (Capitalist) World: A Brexit Antidote
Media Release.

Introducing this Volume

This ‘Beyond Brexit’ BiteSized Fortress Europe Series Volume opens in 1987 and progresses with markets in turmoil, greed in the ascendency (a sign of things-to-come), walls falling, curtains opening, Germany reunifying, China emerging, the USSR collapsing, George Soros rupturing the UK’s monetary policy, the fractious 1992 process limping towards a European Single Market and all of this within four years. As the decade progressed the Chinese dragon fiercely roared and its economy soared. Japan wilted while Asian tigers South Korea, Taiwan, Hong Kong, Singapore, Malaysia and Indonesia flourished. The US quietly blossomed in a sustained period of real (non-inflationary) economic growth underpinned by cumulative annual productivity gains.

At the outset of our tumultuous ten years the much-maligned and misunderstood WTO, with all its rules and regulations and deterrents and structures and commitment to fair play, was still on the horizon as the General Agreement on Tariffs and Trade meandered along its half-century journey towards a belated birth of multilateral (rules-based) ‘free trade’ in 1995.

Global financial markets were characterised by extreme turbulence in a decade which saw capitalism face-off against two varieties of communism, witnessed dramatic transformations in information and communications technologies and concluded with the Asian financial crisis and the newly minted Russian state defaulting on its sovereign debt in 1998.

This book chronicles these cataclysmic events and draws lessons for companies developing global business strategies in turbulent market environments. In the current frenzied and polarised political context businesses should have their strategies, plans and contingencies in place for a post-Brexit free trade competitive landscape regardless of which deal is negotiated: hard, soft or fudgy.

The book is the first of a five-Volume series addressing key challenges faced by companies in the contemporary era of ‘flat-earth’, ‘digital’, post-Brexit globalization. Each Volume of the BiteSized Fortress Europe Series has ‘extended End Notes’ which support the main text and focus on one or more dimensions of the globalization of markets and their impact on global business strategy. End Note One of this book presents a comprehensive chronology of significant ‘Milestones in the History of Globalization’, from Ötzi ‘the Iceman’ millennia ago through Adam Smith in 1776 to the present day of the United Kingdom European Union membership referendum – Brexit – and beyond. End Note Two presents a comprehensive bibliography of recommended global business strategy textbooks and business biographies cited throughout the five BiteSized Fortress Europe Series Volumes.

The ‘Beyond Brexit’ BiteSized Fortress Europe Series is based upon extended Chapter extracts from Outside Fortress Europe: Strategies for the Global Market by Colin Edward Egan (2018, see below). Each Volume covers one specific dimension of global business strategy, thus allowing the reader to focus on a topic or theme which most closely matches their interests and/or business speciality.

Key Questions Addressed in this Volume

  • Why do countries trade? And is it ‘free’?
  • What is Bretton Woods, post-war, ‘new world order’ globalization and where is it heading?
  • What is ‘financial globalization’ and why does it implode every decade?

#   1978/79: Middle East conflict, US protectionist sentiment, OPEC, stagflation.
#   1987/88: Black Monday, Gordon Gekko, Del Boy FiloFaxMan, Loadsamoney, ‘Greed is Good’, ‘Lunch is for wimps’, junk bonds, debt, un-hedged leverage, embezzlement, insider trading and “There is no such thing as society” according to Margaret Thatcher. Crazy frenzied zeitgeist.
#   1997/1998: George Soros and the Asian Financial Crisis, Russia Defaults and the Long Term Capital Management (LTCM) Wall St. cover-up.
#   2007/2008: Greed is back, financial ignorance, moral hazard, regulatory failure, liquidity crisis.
#   2018/2019: China stalls? Taiwan tensions? Trade wars? Currency wars? Quantitative Easing (QE) asset inflation bubble bursts? Brexit? Climate change? Take your pick; watch this space!

  • How and when did the fall of the Wall end the Cold War?
  • Who is George Soros and does he matter?
  • What was the ‘1992 Process’? Inside Fortress Europe and the European Single Market.
  • Capitalism versus communism: final score or half-time?
  • What is liberal democracy and did history end?
  • A tale of two Chinas: how did it happen and what happens next?
  • What is the WTO and why is it ‘hard’? And will/can Donald Trump ‘soften’ it up?
  • Who invented the internet? From Adam Smith to Uber via Apple, Sir Tim Berners Lee, IBM, Bill Gates, Amazon, Google, Facebook, Airbnb, Alibaba et al.
  • How did the newly minted Russian Federation derail Wall St.? And why did nobody notice?
  • What is global business strategy and how can companies of all sizes and from all sectors succeed in world markets? Which organizational challenges will they encounter?
  • A case for optimism? 20/20 vision: doom and gloom or a new enlightenment?

Brexit Extracts from this Volume

“Despite its subtitle, A Brexit Antidote, this is not a Volume about Brexit at all other than that, for most companies, Brexit should be the least of their worries from a long-term marketing, brand, innovation and global business strategy perspective. In this sense, our antidote has aimed to offer a restorative remedy to counteract the posturing and politicking which has characterised and plagued the Brexit discussion to date. It simultaneously explores its very recent historical context and lays the foundations for global business strategy success which we develop in subsequent BiteSized Fortress Europe Series Volumes”.

“…daily news bulletins are dominated by pitiful claims from supposedly well-educated business leaders that there is way too much ‘uncertainty’ in the current economic climate to allow reasonable long-term strategic decision making. It seems that they clamour for stability and surety, a comforting status quo. (Note here Ronald Reagan’s famous aside, ‘status quo is nothing more than Latin for the mess we’re in’). These uncertainty mantras currently arise most vocally amongst executives from the United Kingdom and its EU partners as Brexit processes follow their long and winding road to who knows where.”

“Two years since the Brexit referendum in the UK there is still a protracted discussion relating to whether there will be a ‘hard’ or ‘soft’ Brexit, and there is a ‘deal’ or ‘no deal’ mindset which resembles the tawdry ‘reality’ TV programme (or is it a quiz show?) which has that cheap title”.

“Jean-Claude Junker, President of the European Commission since 2014, is allegedly fond of a tipple or three, apparently to numb the tedium of the endless round of summits and such-like that goes with the job. At one such dull event he was overheard slurring: ‘I have met two big destroyers. Gorbachev who destroyed the Soviet Union, and Cameron who destroyed the United Kingdom’. Harsh words indeed”.

“First things first, British Prime Minister David Cameron didn’t have to call the Brexit referendum. He may have felt honour-bound to do so because it was in the Conservative Party manifesto which brought him to power. But this is British politics; honour? And Cameron had form in breaking ‘cast-iron guaranteed’ political promises… Following his June 2016 referendum ‘loss’, a visibly shocked, pink-cheeked Cameron resigned to ‘put up his trotters’ (Dyer, 2018) and write his truncated political memoir; following some textbook Tory shenanigans, he was replaced by Theresa May”.

“Second things second, British Prime Minister Theresa May didn’t have to call a General Election and she’d steadfastly said on numerous public occasions that she had no intention of doing so. But this is British politics and she did so anyway, throwing away the relatively comfortable majority the Conservative Party would have had for a few more years and leaving it at the mercy of a handful (or two) of Northern Irish politicians: ten Westminster MPs”.

“It all began with Greece, this ‘exit’ momentum, the key difference between that country and the UK being that Greece was threatened with expulsion while Britain chose to leave. ‘Grexit’ was a sort-of-verb-cum-noun coined by Ebrahim Rahbari, Citigroup economist, at a point in time – May 2012 – when it looked highly likely that Greece would be forced into sovereign debt default by a European Union dominated, financially at least, by an uber-fiscally conservative Germany. Along with Grexit came the potential threat of Italexit, Frexit, dePartugal and CzecOut, as one amused blogger blogged”.

“While the Greeks somehow managed to stay within the fold, the United Kingdom embarked upon an extremely complex divorce, well-covered elsewhere and drearily documented day-by-day in hourly news coverage: ad infinitum; ad nauseam; ad absurdum. Our favourite witticism relating to the UK’s stance in the Brexit negotiations came from a tweet by Xavier Bettel, the Prime Minister of Luxembourg: ‘They were in with a load of opt-outs. Now they are out and want a load of opt-ins’”.

“Amongst the most surprising facets of the daily Brexit discussion is the constant equating of a ‘hard’ Brexit with WTO rules, frequently expressed in demonic caricature by vested interests spreading blatant untruths, from one side or the other, intentionally or in seemingly blissful ignorance”.

“And so, we wait and see. But ‘waiting and seeing’ is not a good platform upon which to build long-term effective and efficient global business strategy. Companies should be preparing now for exploiting the opportunities which Brexit might bring as new trade deals are struck, while at the same time building barriers against the looming threats from an uncertain and nervy customs relationship with the EU. There will be one: hard, soft or, most likely, fudgy.”

“Despite numerous cajoles, the author hasn’t and won’t reveal which way he voted in the Brexit referendum and he won’t because it’s irrelevant. And mostly because it is a mixed-up (to put it politely) political farce, just as it was in 1975 when the last referendum on the subject was held and the political parameters then were exactly the same as they are now: in-fighting Tories (Conservatives) and lacklustre-Labour (who knows anymore?) confusing the electorate with members of both parties riven with disagreements between and within themselves. American philosopher and poet Ralph Waldo Emerson once remarked: ‘I hate quotations. Tell me what you know.’ It’s a fair point, especially regarding the overly-cited clichéd variety. But, with reference to Brexit and the parallels with the 1975 ‘should we stay or should we leave’ referendum, US baseball player Yogi Berra’s classic commentary on life is difficult to resist, so we won’t: ‘It’s like déjà vu all over again’. Cool”.

“As influential cognitive psychologist, linguist and philosopher Stephen Pinker observed in 2018 with reference to Adam Smith and the positive benefits of mutual engagement between dependent parties:

Exchange can make an entire society not just richer but nicer, because in an effective market it is cheaper to buy things than to steal them, and other people are more valuable to you alive than dead.

This sounds like a reasonable post-Brexit philosophy for the relationship between the UK and the remaining members of its partner in divorce, the EU. Only time will tell and only a fool would tell you otherwise”.

In Conclusion

In this Volume we convey the dramatic series of simultaneous discontinuous changes and events that arose in an extremely short period of time during the 1990s, a turbulence unknown since the Second World War and one which has defined the contemporary era of globalization. In the Volumes of the BiteSized Fortress Europe Series which accompany this one we discuss the theories, concepts, frameworks, processes and tools which will guide smart managers building intelligent companies towards current and post-Brexit global business strategy success.

Despite an ill-judged and premature General Election held on 8th June 2017 and, other things being equal, the UK will leave the EU at midnight on 29th March 2019. Like all messy divorces, there will be an uncomfortable transition as the former partners find their feet (and their friends) in its aftermath. But long before then, companies should have their strategies, plans and contingencies in place; and that challenge is exactly what the ‘Beyond Brexit’ BiteSized Fortress Europe Series aims to address.

 


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All content © Colin Edward Egan, 2019